Granger Service Company, Inc., was organized by Ted Granger and five other inves

Question

Granger Service Company, Inc., was organized by Ted Granger and five other investors. The following activities occurred during the year:

a.Received $77,000 total cash from the six investors; each investor was issued 9,100 shares of common stock with a par value of $0.10 per share.

b.Purchased equipment for use in the business at a cost of $25,000; one-fourth was paid in cash and the company signed a note for the balance (due in six months).

c.Signed an agreement with a cleaning service to pay $190 per week for cleaning the corporate offices next year.

d.Received an additional contribution from investors who provided $3,700 in cash and land valued at $22,000 in exchange for 1,700 shares of stock in the company.

e.Lent $3,200 to one of the investors who signed a note due in six months.

f.Ted Granger borrowed $7,700 for personal use from a local bank, signing a one-year note.

1. Create T-accounts for the following accounts: Cash, Notes Receivable, Equipment, Land, Notes Payable, Common Stock, and Additional Paid-in Capital. Beginning balances are $0. For each of the preceding transactions, record the effects of the transaction in the appropriate T-accounts. Include good referencing for each T-account.

Explanation / Answer

**for transaction C ,signing of agreement will not be recorded in books until the services are received

**for transaction F, personal transaction are not recorded in business books

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